As the world recovers from the Coronavirus pandemic, it is assumed that financial institutions and other businesses will need to adopt new ways of working to navigate what is said to be one of the worst economic downturn in recent years.
Finextra Research has collaborated with digital transformation company, Exela, on a white paper looking at the potential effects of Request to Pay (RtP) in a post-Covid 19 world as the practices of lenders, businesses and consumers are forced to adapt.
While the potentials of quicker and more frictionless payments with fewer overheads relating to sending out invoices and chasing late payers will resonate with many, there is still likely to be resistance from companies and individuals whose instinct is to stick to tried and trusted methods such as direct debits.
Technology companies find that their clients are concerned by giving customers the option to defer a payment, which would probably be widely taken up if the option is there. Other concerns revolve around the practical tasks of changing billing and CRM systems, as well as the broader apathy of customers who are perfectly happy with the status quo.
However, we may find traditional lending and business practices are found to be unfit for purpose. Financial institutions will be concerned over the ability of their clients seeking lending to repay, SMEs being unable to make investments in their business without steady cashflow and more consumers finding themselves in part-time, zero-hour or contract work.
Against this backdrop, new norms may be created in the way lenders and businesses operate and consumers behave and the transparent communications channel and the instant but flexible method of payment that RtP offers could provide the infrastructure for these.
Alongside the greater flexibility and convenience that RtP can offer, the white paper examines some of the advantages to be found in early adoption for lenders and businesses. Such companies would be able to offer trend-setting use cases for RtP, possibly finding the ‘perfect app’, which succeeds in demonstrating its value to the payments ecosystem.
Click here to download ‘Is Request to Pay the System for a World of New Norms?’ by Finextra in association with Exela.